BCH in 2020 - trout's Perspective
How Did We Get Here?
People, at the individual level, experience frustration when their expectations are not met. Sometimes these expectations are reasonable, and sometimes they are not. Either way, it does not change the outcome, which is the feeling of frustration.
I see a lot of frustration being expressed by the BCH community. Their expectations are not being met.
From my perspective, it appears that most people in the community expect development to proceed with input from that community. They expect that changes will be debated, weighed on their merit, and integrated after some eloquent majority agrees the change is worthwhile.
This expectation is not being met, and frustration is the result. The reason these expectations are not being met, is because they do not reflect reality.
The Landscape I See
The **reality** is that a Bitcoin ecosystem functions through three opposing forces: Miners, Developers, and the Market (composed of exchanges, users, and merchants).
Amaury is the lead developer of ABC. 97% of miners run ABC software. Exchanges and businesses using BCH require reliable software that is ‘good enough’, which ABC provides. None of these relationships require input or direction from the ‘community’. https://cash.coin.dance/blocks/summary
There is a cognitive dissonance playing itself out through the BCH ecosystem. On the one hand, the financial and business success of the cryptocurrency with the ticker ‘BCH’ requires that it stick to the roadmap, be reliable in its functionality (which requires reliable funding), and ultimately sticks to the narrative of ‘digital cash for the world’. https://bitcoincash.org/roadmap.html
On the other hand, there is a vibrant community of anarchocapitalists, cypherpunks, libertarians, and freedom-loving ‘weirdos’ that want to hack and tinker with all that is possible with new cryptocurrency ideas. They are not willing to be dictated to. They are not willing to accept limitations or people with power. I love this community. I am part of it. I have many friends in the community. But this community is not necessary for the success of BCH.
There should be a symbiotic relationship between the community and the business forces. But that relationship is broken.
These are opposing ideals, trying to exist within a single ecosystem. This is the source of the cognitive dissonance, the source of unmet expectations, and the source of frustration.
The frustration will continue, it will build further, until some form of relief is found.
Now, the chance of miners capitulating and running something other than ABC software is pretty low. The chance of exchanges and merchants giving the BCH ticker symbol to something other than the current chain, is pretty low. And the chance of Amaury finding a better way to interface with the community is pretty low. And so the frustration will continue to build.
The only way out of this conundrum that I can see, is to create a new chain, and a new ticker for it. A new place for the community to have its expectations met. Because they will never have them met on the BCH chain.
The only thing holding the community back is the price and the ticker symbol. Many can not stomach the thought of building a new chain. They would rather fight over the existing ticker symbol than start something new.
And so, the fighting will probably continue for the foreseeable future. But from my perspective, the community will not win, and the fighting and frustration will continue, until enough members of that community create a new chain that embodies their ideals.
Moving Forward
I wish I didn’t have to write these words. I wish this wasn’t the conclusion I was forced to draw. I wish we could restore the symbiotic relationship between ‘successful business’ and ‘happy community’. But as a pragmatic person trying to build a business in this space, I have to dispassionately assess the forces and landscape before me. Wishing doesn’t do any good.
I will continue to build on and support ABC. I think they produce reliable software, a foundation which enables me to solve business problems for my clients.
And if another chain was to emerge, I would support that too. FullStack.cash would actively build tools to support the growth of that new chain. https://FullStack.cash
The *Best* Currency
I’ve been communicating with several Bitcoin Cash supporters in Venezuela. This article shares my revelations in what would make the ‘best’ currency, which is a direct result of talking to these people.
If cryptocurrency is better money, if it truly solves problems for the common man, then there is no better place for it to do this than Venezuela. Any lessons learned from crypto adoption in the country should inform outreach and adoption efforts in other countries. And with the new financial crisis bearing down on the world economy, there is no better time to contemplate and integrate the lessons learned over the last couple years.
Cryptocurrency **is** solving problems, but not in the way that most Bitcoin supporters think. Neither BTC, Dash, Ethereum, or Bitcoin Cash is an adequate solution for merchants in Venezuela. They all fall short of the **Best** currency. This currency does not yet exist, and I don’t know what it will be called, but from my discussions with Venezuelans, I’ve gotten a clear picture of the traits it will display. For lack of a better name, I’m going to refer to it as the Best currency.
Lessons from Venezuela
As Roger Ver is fond of saying: BCH is fast, secure, cheap, reliable, and private. Other cryptocurrencies check some of these boxes too. ...But is it enough? From talking with Venezuelans, the answer is no. It’s a great start, but we aren’t there yet. The recent market sell-off just proved the point. https://cashshuffle.com/
So what’s missing?
I recently had a great discussion with Roberto, the manager of the Bitcoin Cash House in Barqestimeto. He told me that most merchants who accept BCH do it through an app called Uphold. I checked into this app. It’s controlled by a UK-based bank. It’s custodial. Once enrolled, you can switch between many fiat currencies, a stable coin of their own, and several cryptocurrencies. The ease, breadth, and popularity of the app makes it an obvious choice for Venezuelan merchants. https://read.cash/@BCHouseVE https://twitter.com/bchbarquisimeto https://uphold.com/
But digging a little deeper showed some obvious room for improvement. First of all it’s custodial. Roberto admitted that people have had their funds frozen by the bank due to ‘suspicious’ activity. So while the app provides stability and ease, it is neither permissionless nor unconfiscatable. Venezuelans need to ask permission to use the app, and at any point their funds can be seized.
Venezuelans are willing to put up with the shortcoming because of their insatiable hunger for a *stable* currency. In a world of hyperinflation, they crave stability. Compared to the Bolivar, even the wild volatility of Bitcoin seems stable. Many countries are in the same situation as Venezuela, many more will be in the near future.
So now the traits of the Best currency are revealed. It is:
Stable
Permissionless
Unconfiscatable
Getting from Here to There
As I said, this Best currency doesn’t yet exist, but we’re getting close. Bitcoin is volatile, yes, but volatility can be good. No risk, no reward, as they say. But as any Venezuelan can attest, currency stability is highly desirable.
Currently on the BCH network is the SLP token, USDH, produced by Honest Coin. They are highly transparent, regulated, and frequently audited. By dividing ones savings between BCH and USDH, each individual is empowered to choose their own balance between volatility and stability. Both are permissionless and unconfiscatable. The two get almost all the way to the three traits of the Best currency. And Sideshift.ai allows people to instantly switch between one or the other, with no sign-up required. https://simpleledger.info/#token/c4b0d62156b3fa5c8f3436079b5394f7edc1bef5dc1cd2f9d0c4d46f82cca479 https://www.honestcoin.io/ https://sideshift.ai/
But of course, USDH isn’t *really* unconfiscatable. The US government doesn’t need to confiscate your tokens if they can attack the centralized company. While the notion of a stable coin is helpful, there is third-party risk associated with every stable coin in existence. Even DAI, the decentralized, algorithmic stable coin, has its own issues. https://makerdao.com/en/
To be clear, I’m bullish on stable coins, not the US dollar. That may seem contradictory since almost all stable coins are pegged to the US dollar. The undeniable reality is that the US dollar is one of the worlds most stable fiat currencies. I’ve come to understand that crypto will never *replace* it, but may *co-opt* it. After all, unlike real US dollars, stable coins are not regulated by the NY Fed. They are pegged to the dollar, but not regulated by any government entity. That’s why the IMF is so afraid of stable coins. https://www.bloomberg.com/news/articles/2019-10-16/fed-drags-feet-as-digital-money-revolution-tests-central-banks
It is my hope that one day an algorithmic stable coin will be created that is truly permissionless and unconfiscatable. For the present however, it is possible to mitigate the threat of third-party risk by diversifying among different stable coins. My personal favorites are Honest Coin and DAI, but Tether is also worthy of consideration due to its popularity. Many banks such as Uphold and Airtm offer their own stable coins, and are accessible to Venezuelans. https://www.honestcoin.io/ https://makerdao.com/en/ https://tether.to/ https://uphold.com/ https://www.airtm.com/
For the wealth one chooses to allocate to stable coins, it is wise to diversify it among several stable coins. That way, if any one coin gets taken down, it’s not a complete loss to the individual. This is currently the most optimized portfolio a world-citizen can achieve, and the closest one can come to the Best currency.
I believe that one day a single coin will embody all the traits of the Best currency. A single coin will achieve stability, permissionlessness, and unconfiscatability. It will also be fast, secure, reliable, and private. It will probably be backed by a basket of other fiat and cryptocurrencies, and it will be outside the reach of any state actor.
The reason I know it will exist, is because every human on earth wants to achieve it. They may not know it, they may not even be able to conceptualize it, but every human yearns for sovereignty. And money is simply a reflection of human nature.
Making Bitcoin Cash Truly Unconfiscatable
This video shows how to use some software I wrote to generate 'paper' wallets for Bitcoin Cash. This allows you to store your BCH in a 'cold wallet'. I take the concept a step further by using a laser engraver to etch the information onto a plastic card. This card can be buried, like gold.
https://www.youtube.com/watch?v=3qn0mmfwlBQ
Cold Storage for SLP Tokens
This video extends the video above, by showing how to use the same software to create a paper wallet to store SLP tokens. You can retrieve the tokens off the paper wallet using Badger Mobile or the sweep command in slp-cli-wallet. https://badger.bitcoin.com/ https://github.com/christroutner/slp-cli-wallet#slp-cli-wallet-sweep
https://www.youtube.com/watch?v=g7G-TZ7fW2s
Review Requested: BCH Benchmark Test
At the end of the **BCH dev meeting (2020 meeting #1)**, I presented a rough draft of a series of benchmark tests that I'm developing to run against BCH infrastructure. The tests are based on the concept of the **Cash Stack**, which is a stack of software that includes a full node, indexer, REST API, SDK, and application (like a wallet). https://www.thefutureofbitcoin.cash/development-meetings https://troutsblog.com/research/bitcoin-cash/how-to-bch-full-stack-developer
The idea is to test the system-as-a-whole, but variations of the test stress specific sub-components, like the indexer or full node. **The goal is to create standardized tests that can be applied to different configurations, and allow an apples-to-apples comparison between different full node implementation, indexers, etc.**
I've released v1.0.0 of the benchmark tests with some initial baseline data. I'd love for developers to review the documents in the repository and provide any critical feedback. Feedback can be left as a GitHub Issue in the repository:
**https://github.com/christroutner/benchmark-bch/tree/master/docs**
I invite organizations behind the various full node implementations and indexers to work with me. It would be great to benchmark the different pieces of infrastructure against one another. I've already reached out to OpenBazaar to test the BCH indexer behind their infrastructure. I'll also be running these benchmark tests against **SLPDB** and the **Bitcoin.com SLP Java Indexer**. https://simpleledger.cash/project/slpdb/ https://read.cash/@EmilOldenburg/bitcoincom-slp-indexer-cc1d40c4
@trout
